The Effect Of Shadow Banking Development On Enterprise Investment

According to the hypothesis of Financing Constraints,strong financing constraints will reduce the investment expenditure of enterprises and lead to insufficient investment,which is not conducive to the sustainable and healthy development of enterprises.Since the financial crisis in 2008,China adopts moderately loose monetary policy which has led to a rapid increase in credit scale and the accumulation of systemic financial risks.With the gradual tightening of monetary policy,the central bank strictly controls the investment target,scale and structure of commercial bank loans,forcing commercial banks to shrink their loan scale in balance sheet and transfer the risky credit assets to off balance sheet asset in the form of shadow banking,thus give rise to the booming of shadow banking.To some extent,the development of shadow banking relieves the financing constraints of enterprises under the tight monetary policy.The objective of this research is to explore the effect and channels of influence from different types of shadow banking on investment of enterprises in China.This research mainly adopts the research method of combining literature research and empirical research.Through theoretical analysis and empirical test,it tries to identify the influence of the development of shadow banking on enterprise investment in China,and investigates the influence channels,and then analyzes the difference of conclusions between enterprises with various features.Firstly,this research conducts theoretical analysis through literature review and deduces the influence of shadow banking on enterprise investment,then analyzes possible influence channels,namely cash flow channel and information asymmetry channel.Further,according to the different operating subjects of shadow banking business,it can be divided into three types: shadow banking business dominated by banking system(BSB),financing business of non-bank financial institutions(NBFB)and financing business of folk finance(PFB),and then the scale of shadow banking of three types is measured.Thirdly,according to the research hypothesis,a panel fixed effect model is constructed to empirically test the influence effect and influence channel of three types of shadow banking on enterprise investment.On this basis,enterprise heterogeneities,such as industry category,ownership nature,regional economic development level,are considered to influence the effect of shadow banking on enterprise investment.The research findings are as follows:(1)Both totality of shadow banking and three types of shadow banking have a significant promoting effect on enterprise investment,and the development of shadow banking effectively improves the level of enterprise investment.By examining the heterogeneity of enterprises,it is found that shadow banking plays a more significant role in promoting investment behavior of cash-flow sensitive industries,nonstate-owned enterprises and enterprises in east-central-west regions.(2)The totality of shadow banking(SBS)reduces the enterprise investment-cashflow sensitivity through the channel of cash flow,thus significantly promotes investment.The promotion effect of the NBFB is significant,but the effect of the PFB is relatively weak.The ownership nature of enterprises does not affect the promotion effect of shadow banking on investment through cash flow channel,but the BSB and the NBFB have more significant effect on the investment of non-state-owned enterprises.(3)As a whole,SBS can weaken underinvestment by reducing information asymmetry and thus improve the investment efficiency of enterprises,especially for non-state-owned enterprises.However,it is difficult for shadow banking to reduce overinvestment of enterprises through information asymmetry channel.The contribution of the research is to expand the study on shadow banking,which supplements the empirical evidence in the field of macro financial development and micro corporate behavior,and provides references for the government to formulate differentiated financial supervision policies and financing policies to match enterprises with differences in characteristics.